Dynamic Limited had credit sales of $675,000 for March. Accounts receivable of $6,000 were determined to be worthless and were written off during March. Accounts receivable total $575,000 at March 31. Management feels that based on past experience, approximately 2% of net credit sales will prove to be uncollectible.
-Refer to the above data. Assuming Dynamic Limited uses the direct write-off method of accounting for uncollectible accounts, uncollectible accounts expense for March is:

Question

Quizplus · Accepted Answer

Under the direct write-off method, uncollectible accounts expense is recognized when specific accounts are deemed uncollectible. In March, $6,000 was written off, so the uncollectible accounts expense for March is $6,000.

Dynamic Limited Had Credit Sales of $675,000 for March